Under the proposed Human Fertilisation and Embryology Bill, using embryo-screening deliberately to create a child with a serious medical condition - which officials had said includes being deaf - would be illegal.

Now, however, the Department of Health has agreed to cut from the Bill any reference to deafness as a serious medical condition.

The move could pave the way for the Bill to be amended, when it passes through the Commons later this year, permitting a challenge over whether deafness should be classed as a serious medical condition for the purposes of the bill and allowing parents to pick an embryo, using IVF treatment, that will develop into a deaf child.

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The Bill has already angered many MPs and church leaders because it will permit the creation of hybrid embryos, where human DNA is inserted into animal cells for research, and will also remove the requirement for a father in couples undergoing fertility treatment.

Deaf campaigners claim that, although the vast majority of deaf parents would want a child who had normal hearing, some might prefer to create a child who was also deaf and so better able to fit in with their family.

They argue that the proposed legislation is discriminatory because it gives parents the right to create "designer babies" free from inherited genetic conditions while banning disabled couples from deliberately creating a baby who shares their disability. Doctors, however, strongly oppose any plans to allow the creation of deaf babies.

The issue first came under the spotlight six years ago in America, when it emerged that a deaf couple had sought out a sperm donor with a family history of deafness. After the anger caused by that case, officials singled out deafness as being a condition that would be covered by the Bill.

Ministers, however, were shocked by the strength of opposition from members of the deaf community. Campaigners now believe the removal of the reference to deafness signals a softening of the Government's position.

They now hope that MPs will be able to amend the Bill when it is debated so that the clause banning the creation of disabled children will be dropped entirely. This, they say, would grant deaf parents equal rights with hearing parents.

Anna Middleton, a genetics counsellor involved in the campaign to change the clause, said: "It is encouraging that our debate with the Department of Health has had this impact."

Professor Peter Braude, director of the country's leading centre for pre-implantation genetic diagnosis at Guy's and St Thomas' Hospital in London, said: "I have serious concerns about deliberately selecting a embryo for deafness. This is the same as taking a normal child and deliberately making it deaf so that it can fit in with a community.

"I don't see how that can be acceptable."

Case study - 'choice should be ours'

Paula Garfield and Tomato Lichy, are at the centre of the debate over the new fertility legislation. Both are deaf – as is their daughter Molly, three.

They would like a second child, but because Paula is in her 40s, she may need IVF treatment.

They want the right to choose to have a deaf child and say it is discriminatory to ban deaf parents from doing this. Mr Lichy said:

"Being deaf is not about being disabled. It's about being part of a linguistic minority. We're proud of the language we use and the community we live in."